Accounts and Notes Receivable Lenox Corp. sold merchandise for $2,800 to M. Baxter on May 15, 2017, with payment due in 10 days. Subsequent to this, Baxter experienced cash-flow problems and was unable to pay its debt. On August 10, 2017, Lenox stopped trying to collect the outstanding receivable from Baxter and wrote off the account as uncollectible. On December 1, 2017, Baxter sent Lenox a check for $800 and offered to sign a two-month, 6%, $2,000 promissory note to satisfy the remaining obligation Baxter paid the entire amount due Lenox, with Interest, on January 31, 2018. Lenox ends its accounting year on December 31 each year and uses the allowanc method to account for bad debts. Required: Identity and analyze all transactions on the books of Lenox Corp. from May 15, 2017, to January 31, 2018. Do not round Intermediate calculations. If required, round your final answer to the nearest dollar The effect of the sale transaction on May 15. Activity Accounts Statement(s) How does this entry affect the accounting equation? If a financial statement item is not affected, select "No Entry and leave the amount box blank. If the effect on a financial statement item is negative, Le, a decrease, be sure to enter the answer with a minus sign Balance Sheet Income State Stockholders Assets Liabilities + Equity Revenues The effect of the transaction to write of the account on August 10. The effect of the transaction to write of the account on August 10. Activity Accounts Statement(s) How does this entry affect the accounting equation? If a financial statement item is not affected, select "No Entry and leave the amount box blank. If the effect on a financial statement item is negative, le, a decrease, be sure to enter the answer with a minus sign. Remember: If a contra account is increased, it will have the effect of decreasing the corresponding financial statement item. Balance Sheet Income States Stockholders Assets Liabilities Equity Revenues The effect of the transaction to reinstate the allowance account on December 1 Activity Accounts Statement(s) How does this entry affect the accounting equation? If a financial statement item is not affected, select "No Entry and leave the amount box blank. If the effect on a financial statement item is negative, L., a decrease, be sure to enter the answer with a minus sign. Remember if a contra account is increased, it will have the effect of decreasing the corresponding financial statement item Balance Sheet Balance Sheet Income Stater Stockholders' Equity + Liabilities Assets Revenues The effect of the transaction to collect cash and receive a promissory note on December 1. Activity Accounts Statement(s) How does this entry affect the accounting equation? if a financial statement item is not affected, select "No Entry and leave the amount box blank. If the effect on a financial statement item is negative, le, a decrease, be sure to enter the answer with a minus sign Balance Sheet Income Staten Stockholders' Assets Llabilities Equity Revenues The effect of the adjustment on December 31 Activity Accounts HVID Accounts Statement(s) How does this entry affect the accounting equation? If a financial statement item is not affected, select "No Entry and leave the amount box blank. If the effect on a financial statement item is negative, le, a decrease, be sure to enter the answer with a minus sign Balance Sheet Income Staten Stockholders' Assets Llabilities Equity Revenues The effect of the transaction on January 31, Activity Accounts Statement(s) How does this entry affect the accounting equation? if a financial statement item is not affected, select "No Entry and leave the amount box blank. If the effect on a financial statement item is negative, 1.0, a decrease, be sure to enter the answer with a minus sign Income Stater Stockholders' Balance Sheet Assets Liabilities Equity Revenues Asses Wabuities Equity The effect of the transaction on January 31 Activity Accounts Statement(s) How does this entry affect the accounting equation? If a financial statement item is not affected, select "No Entry and leave the amount box blank. If the effect on a financial statement item is negative, le, a decrease, be sure to enter the answer with a minus sign Balance Sheet Income Stater Stockholders' Assets Liabilities Equity Revenues 2. Why would Baxter bother to send Lenox a check for $800 on December 1 and agree to sign a note for the balance, given that such a long period of time had passed since the original purchase? Choose the best answer: 3. Baxter was required to do this to avoid bankruptcy. b. Baxter would want to reestablish their good credit standing with supplier in order to purchase products in the future. C. Baxter's owner could not bear the guilt of nonpayment